UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 50675 / November 16, 2004

Investment Advisers Act of 1940
Release No. 2327 / November 16, 2004

Admin. Proc. File No. 3-11738

In the Matter of

MICHAEL JOHN HANCHAR,

Respondent.

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ORDER INSTITUTING ADMINISTRATIVE PROCEEDINGS PURSUANT TO SECTIONS 15(b) AND 17A(c)(4)(C) OF THE SECURITIES EXCHANGE ACT OF 1934 AND SECTION 203(f) OF THE INVESTMENT ADVISERS ACT OF 1940, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Sections 15(b) and 17A(c)(4)(C) of the Securities Exchange Act of 1934 ("Exchange Act") and Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act") against Michael John Hanchar ("Hanchar" or "Respondent").

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer of Settlement (the "Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, and the findings contained in Sections III.1 and III.2 below, which are admitted, Respondent consents to the entry of this Order Instituting Administrative Proceedings Pursuant to Sections 15(b) and 17A(c)(4)(C) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions ("Order"), as set forth below.

III.

On the basis of this Order and Respondent's Offer, the Commission finds that:

1. Hanchar, age 38, is a resident of Caņon City, Colorado. Between January 2002 and November 2002, Hanchar was a manager at Liberty Funds Services, Inc., a registered transfer agent. Additionally, during this time period, Hanchar was a registered representative associated with Liberty Funds Distributor, Inc., a registered broker-dealer, and also associated with Stein Roe & Farnham, Inc., a registered investment adviser.

2. On July 8, 2003, Hanchar pled guilty to one count of class four felony theft before the Denver District Court of the State of Colorado, in State of Colorado v. Michael Hanchar, Case No. 03CR1740. On September 29, 2003, a final judgment in the criminal case was entered against Hanchar. He was sentenced to six years in prison, three years of probation, and ordered to pay $1.08 million in restitution.

3. The count of the criminal complaint and information to which Hanchar pled guilty alleged, inter alia, that between January 2002 and November 2002, Hanchar feloniously, unlawfully, and knowingly obtained or exercised control over more than a million dollars belonging to his employer without authorization or by threat or deception, and then, with the intent to deprive permanently his employer of the use and benefit of such property, used the funds for his personal benefit.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions agreed to in Respondent Hanchar's Offer.

Accordingly, it is hereby ORDERED:

Pursuant to Sections 15(b)(6) and 17A(c)(4)(C) of the Exchange Act and Section 203(f) of the Advisers Act, that Respondent Hanchar be, and hereby is, barred from association with any broker, dealer, transfer agent, or investment adviser.

Any reapplication for association by the Respondent will be subject to the applicable laws and regulations governing the reentry process, and reentry may be conditioned upon a number of factors, including, but not limited to, the satisfaction of any or all of the following: (a) any disgorgement ordered against the Respondent, whether or not the Commission has fully or partially waived payment of such disgorgement; (b) any arbitration award related to the conduct that served as the basis for the Commission order; (c) any self-regulatory organization arbitration award to a customer, whether or not related to the conduct that served as the basis for the Commission order; and (d) any restitution order by a self-regulatory organization, whether or not related to the conduct that served as the basis for the Commission order.